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I was facing the Internal Server Error on my GoDaddy hosting after installing the WP-Cache plugin.
Givver has a post over at his blog that helped me fix the problem. So, if you are facing the 500 “Internal Server Error” on your wordpress blog after installing the WP Cache, have a look at GoDaddy 500 Internal Server Error at Ramblings of a Bored Geek and get it fixed ..
cheers ! ( and thankyou Givver )